• DOJ on Elie and Campos Motions: Poker is Still Gambling

    The US Department of Justice has responded to motions of dismissal filed by Black Friday defendants Chad Elie and John Campos in a 58-page motion that says, essentially, one key thing:

    That poker is still considered gambling in the eyes of US law.

    Calling on as diverse a range of precedents as the Kenny Rogers’ song “The Gambler” and an 1888 saloon trial, US attorney Preet Bhahara’s primary explanation for denial of the motions is that “Playing poker for money has, since the birth of the game in the 1800s, been treated both in American culture and law as a form of gambling.”

    By definition then, Bhahara contends, all of the Black Friday defendants violated US law – and specifically both the Illegal Gambling Business Act of 1970 (IGBA) and the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA).

    To make its case for denial of Elie’s and Campos dismissal motions, the DOJ motion references 65 previous cases in US courts and 16 US statutes in the document.

    The DOJ’s full preliminary statement is included below:

    “Playing poker for money has, since the birth of the game in the 1800s, been treated both in American culture and law as a form of gambling.

    “Historically, states legislatures enacted laws that have either prohibited the operation of gambling businesses outright or subjected them to significant regulation, and state courts have regularly applied these gambling laws to poker rooms.

    “New York courts, for their part, have treated poker as illegal gambling in reported opinions dating back 100 years. Federal regulation of gambling is more recent, and has been explicitly crafted to build upon – not replace or alter – pre-existing state law.

    “Both the Illegal Gambling Businesses Act of 1970 (“IGBA”), 18 U.S.C. § 1955, and the Unlawful Internet Gambling Enforcement Act of 2006, 31 U.S.C §§ 5361-67 (“UIGEA”), incorporate by reference the gambling laws of states where the business at issue operates, and federal law too has therefore routinely been applied to poker businesses.

    “The 2006 enactment of UIGEA, which specifically criminalized the use of the United States. financial system to accept payments from gamblers, gave rise to the core of the conduct alleged in this Indictment.

    “The leading internet poker company of the pre-UIGEA era shut down its U.S. operation, and the founders of the gambling industry’s dominant payment processor were arrested.

    “The poker companies who rushed to fill the void encountered a daunting obstacle: there was no legitimate or easy way to obtain the billions of dollars from United States residents that was the lifeblood of their businesses.

    “So they engaged Elie and Campos, among others, to perform an indispensable service: find ways, by hook or crook, to move money from United States residents, through the United States financial system, to the offshore accounts of the poker companies.

    “They did so in violation of IGBA, the UIGEA and other federal statutes. Yet defendants argue in their motions to dismiss that the Indictment’s detailed allegations do not in fact allege the commission of any crime at all.

    “They claim that IGBA simply does not apply to poker, or at least is “ambiguous” in its application, notwithstanding longstanding precedent to the contrary at the state and federal levels.

    “Defendants then read UIGEA, which applies if anything more broadly than IGBA, to contain an implicit exemption for internet poker companies — or, if not for the poker companies, for those who conspire with them to process payments — based on a tortured construction of the statute at war with its plain language and clear legislative intent.

    “Elie, who is charged with a conspiracy to commit bank and wire fraud involving tricking banks into processing illegal transactions without their knowledge, nevertheless contends that this is not a federal crime since the banks earned fees and were thus not harmed by being deceived.

    “These conveniently cramped constructions of the statutes at issue are nothing more than exercises in wishful thinking.

    “If proven, the conduct alleged in the Indictment – a scheme through which the charged defendants abused the U.S. financial system in order to fund their illegal operations – amounts to clear violations of the statutes charged.”

    Campos and Elie are facing six and nine counts,, respectively under the current indictments and have plead not guilty to all counts.

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